Failure To Recover Over N4.4tn Debt Bad For Economy – AMCON 

 

The Asset Management Corporation of Nigeria (AMCON) has called on all agencies of the Federal Government and all stakeholders to join its debt recovery drive as the company hopes to secure an outstanding N4.4trillion.

AMCON in a statement issued on Sunday noted that a failure to recover the debt would further worsen the nation’s economy.

According to the agency, the N4.4trillion is bigger than the entire 2021 capital expenditure budget of the Federal Government, which stands at N3.85trillion.

If recovered, the agency believes that the money can go a long way in reviving the iron and steel sectors, as well as improving electricity in the country.

It also believes that this would involve the employment of more manpower which in turn would reduce the crime rate in the country.

“AMCON assured that it is determined to recover these debts because the money belongs to Nigerian taxpayers,” the statement read in part.

 


Read the full statement below.

The Asset Management Corporation of Nigeria (AMCON) has raised a New Year alarm, calling on all agencies of the Federal Government and all stakeholders to join its debt recovery drive to guide against the huge opportunity cost of not recovering its huge total current exposure.

The Corporation disclosed that its current exposure stands at N4.4trillion.

This colossal outstanding going by the 2021 budget estimate rivals the entire budget of the 36 states of the Federal Republic of Nigeria.

N4.4trillion, which is owed AMCON is bigger than the entire 2021 capital expenditure budget of the federal government of Nigeria, which stands at N3.85trillion. It is also bigger than the N3.12trillion for total foreign debt service for 2021 and personnel cost of N3.7trillion.

The development of the iron and steel sector as well as the electricity sector are essential ingredients to industrialisation in any country and the debt owed AMCON can do a lot in improving electricity generation and distribution as well as revival of the challenged iron and steel sector.

Similarly, AMCON added that the huge debt if recovered would be enough to capitalize over 2million Micro Businesses with N2million cash injection each or 200,000 Small and Medium Enterprises (SMEs) with N20million per SME, which would create over 10million jobs in the country.

By so doing, the agency said thousands of unemployed youths who are involved with all sorts of violent crimes would be engaged positively.

With all these facts and its negative effect to the economy, the Corporation explained that it would not be fair to allow this crop of obligors that have collectively destroyed the commonwealth of Nigerians escape justice, which is why it is calling on all sister agencies to support the recovery drive.

AMCON assured that it is determined to recover these debts because the money belongs to Nigerian taxpayers.

These startling revelations were contained in a paper Mr Joshua Ikioda, the Group Head of AMCON Enforcement presented in Abuja, which was titled “Overview of AMCON from Cradle to Date and the Implication of the Bad Debt to the Nigerian Economy.”

He made the presentation at the just concluded 2-day training for Federal High Court Legal Assistants and Court Registrars in Abuja.

The event was declared open by Hon. Justice Inyang Ekwo of the Federal High Court, Abuja, and attended by Dr Eberechukwu Uneze and Mr Aminu Ismail both Executive Directors of AMCON as well as Hon. Justice Nkeonye Evelyn Maha also of the Federal High Court.

AMCON MD/CEO Mr Ahmed Kuru in his keynote address at the beginning of the training, which ended at the weekend said AMCON cannot over flog the important role of the Judiciary in national development and as such remains vital to the success of AMCON.

Kuru who was represented by Dr Uneze said, “We are just a government recovery agency saddled with the responsibility of purchasing non-performing loans from Banks and ensuring it is paid back using the instrumentality of the law. Unfortunately, it did not turn out to be that easy, through the instrumentality of the courts as we encountered a lot of challenges.

“The obligors get wiser by the day, deliberately causing orchestrated legal delays knowing that AMCON has a sunset date. The Act was amended in 2015 to address some of the encountered challenges, again obligors got wiser, hence necessitating another amendment in 2019 all with the single objective of recovering the loans bought from banks in order to settle our debt without recourse to taxpayers money, this outstanding exposure is not a small amount of money.

“…Due to the limited lifespan of AMCON, there is a need for a speedy and simplified litigation process. The reason is clear: AMCON is a special purpose vehicle for the recovery of ‘toxic’ debts.

The debts are so bad that the government had to purchase them to prevent a collapse of the economy. AMCON’s mandate is therefore to recover these debts for our common survival to be guaranteed. The rationale behind the AMCON regime is therefore to quickly recover the bad debts within a legal framework that ensures speed without compromising fair hearing.

“AMCON jurisprudence is primarily regulated by the AMCON Act 2010 (as amended in 2015 and 2019), Federal High Court Practice Directions of 2013 and The Federal High Court AMCON Rules 2018.

The Directions and the Rules have introduced a new culture of expediency in determining AMCON matters at the Federal High Court.

Therefore, it is imperative for you to understand the AMCON spirit, which means speed and efficiency.”

Insisting that AMCON needs all hands to be on deck, the CEO added, “The amended AMCON Act 2019 was a robust attempt to address the shortcomings in the erstwhile AMCON Instruments i.e., the 2010 Principal enactment and the 2015 amendment.

Recognizing the challenges inherent in these Instruments that undermine the realization of the AMCON mandate, the AMCON Act was further amended in 2019. The objective of this amendment is to enhance the Corporation’s capacity and improve the supporting mandate for enforcement.

“I must also reiterate that the amendment also became very necessary given our experience with recalcitrant debtors who constantly try to avoid, circumvent, and totally deny commitments and obligations.

These obligors rather than settle their indebtedness, prefer to rely on technicalities to frustrate the Corporation from acting against them.

“The amended Act has far-reaching implications to the mandates of the Corporation in resolving troubled assets especially as they relate to recalcitrant obligors. The amended Act reposed the Corporation with phenomenal powers that are disconnected from common sense and convention.

Accordingly, it is very essential that the Corporation embarks on extensive public awareness by engaging the Hon. Registrars and Legal Assistants to the Hon. Judges of the Federal High Court,” Kuru concluded.

The training, which was organised by the Dr. Fatihu Abba-led Legal Academy under the auspices of the office of the Chief Registrar of the Federal High Court was designed to enlighten Legal Assistants and Registrars of the Federal High Court on the AMCON mandate. It was themed, “The Role Of Registrars And Legal Assistants In The Effective And Efficient Realization Of AMCON Mandate.”

 

Biden Promises Economic Help Is On The Way

File photo: President-elect Joe Biden Mark Makela/Getty Images/AFP

 

US President-elect Joe Biden on Friday introduced the final members of his “worker power” economic team and pledged to provide more help for struggling families and small businesses.

Speaking just one day after lawmakers finally certified his election victory following the invasion of the US Capitol by supporters of outgoing president Donald Trump, Biden announced he would next week unveil a relief program for the pandemic-ravaged economy.

The far-reaching package including stimulus checks to taxpayers and an increase in the minimum wage will be a top priority for Biden, along with accelerating the Covid-19 vaccine rollout that he called “a travesty.”

“We need more direct relief flowing to families, small businesses, including finishing the job of getting people the $2,000 in relief direct payment,” he said.

The $600 stimulus checks included in an aid package Congress approved in late December “is simply not enough,” Biden said at an event in Wilmington, Delaware.

The Senate blocked an effort to increase the second round of stimulus payments to $2,000, but Biden said families are having “to choose between paying rent, putting food on the table (and) keeping the lights on.”

His team also will give special attention to small businesses, especially those owned by minorities, and provide “support to help them get through the other side of this crisis”

He lamented that under the Trump administration “big, well-connected businesses jumped in front of the line” to get aid, and vowed to tighten controls to prevent fraud.

In an aid package passed in December, Congress approved $284 billion for a second round of loans to small businesses via the Paycheck Protection Program, which are due to roll out starting next week.

Biden said money is needed to reopen schools safely, and also for state and local governments to retain teachers, police officers and firefighters.

With Democrats poised to take control of both houses of Congress following victories in two Senate runoff races in Georgia, Biden said he hopes to win support for increasing the US minimum wage to $15 an hour.

“I’ve long said that we need to reward work, not just wealth, in this country. People in both parties recognize it’s time to raise the minimum wage,” he said.

If confirmed by the Senate, the nominees he introduced Friday will play key roles in implementing his economic programs.

He named Rhode Island Governor Gina Raimondo as Commerce Secretary, Boston mayor and former union president Martin Walsh as Labor Secretary, and Isabel Guzman, a former official in Barack Obama’s administration, as Small Business Administration chief.

Raimondo would be involved in negotiating the aftermath of trade wars instigated by Trump, as well as in the ongoing debate over how to regulate tech giants.

COVID-19 Takes Its Toll On African Economy

An undertaker from the AVBOB funeral house in Soweto, carries into a cold storage room the remains of a COVID-19 coronavirus patient on July 21, 2020. MARCO LONGARI / AFP

 

Africa has so far been spared the worst of the coronavirus pandemic in terms of cases and deaths but its economy has not been so lucky, especially the poorer, smaller countries dependent on a single resource or sector.

The spread of the disease has also picked up speed in recent weeks, stoking concerns that worse is to come.

Here are some key features of the pandemic’s economic impact on Africa:

– Historic recession –

For 2020, the International Monetary Fund (IMF) estimates that the economy of sub-Saharan Africa will shrink 3.0 percent, “the worst outcome on record”. However, it should then grow 3.1 percent next year — although this is a much slower pace than elsewhere in the world.

In terms of per capita income, it has fallen 5.3 percent and back to 2013 levels in the space of just a few months.

Abebe Aemro Selassie, the head of the IMF’s African division, highlighted the fact that unlike in the 2008-09 global financial crisis, sub-Saharan countries were in a much worse budgetary position, with fewer resources available to face the crisis than their wealthier peers.

– Different countries, different impact –

African countries can be classified as three economic types:

— Diversified, such as in West Africa, with Ivory Coast, Senegal and Ghana. In the east, Kenya, Uganda and Tanzania.

In these economies, activity has slowed significantly but they are still managing to grow, the IMF says.

— Oil producers such as Algeria, Angola and Nigeria. They have suffered very badly from the plunge in crude prices, especially in the early months of the crisis.

READ ALSO: COVID-19: Five Things To Know About Landmark UK Vaccine

Since then, prices have firmed slowly to arrive back at around $50 per barrel.

— Tourism-dependent countries such as Morocco, Tunisia and the Seychelles. The pandemic has brought travel to a virtual standstill, grounding airlines, which are struggling to survive.

“The crisis has confirmed the differences between diversified countries and the exporters of industrial raw materials but has also impacted North African countries which were in a growth rebound thanks to tourism since 2016,” noted Clement Gillet, economist with Societe Generale.

Standing on its own, South Africa, the continent’s second-biggest economy, has been hit the worst given that it was already in recession before the crisis hit.

Its economy is expected to shrink 8.0 percent this year.

– Raising funds –

Again, the picture is mixed when it comes to how different countries manage debt and raise fresh funds.

On the one hand, there is Zambia, which is heavily dependent on mining and became the first country to default on its debt last month, while Ivory Coast only two weeks later easily raised funds on the market.

Since then, “the financial markets have found their appetite for risk again, and especially for African debt, but investors are going to be much more careful about the details” and quality of the issuers, said Gillet.

Another important source of funds for African countries is remittances from their foreign workers and inevitably this has also suffered in the pandemic.

According to the World Bank, such remittances are expected to fall 14 percent to about $470 billion going into 2021.

“The impact of Covid-19 is pervasive when viewed through a migration lens as it affects migrants and their families who rely on remittances,” said Mamta Murthi, Vice President for Human Development and Chair of the Migration Steering Group at the World Bank.

– Debt –

G20 countries have already put in place a moratorium on interest payments for some 47 countries, most of them in Africa.

The G20 has also said its members are ready to re-negotiate some of the debt itself but such moves have limits.

“Firstly, about 40 percent of African debt is accounted for by the private sector,” and not by governments, noted Kako Nubukpo, an economist and a former minister of Togo.

“Certain countries, such as Benin, with a lot of private sector debt, oppose the moratorium because they fear that when they return to the market to raise fresh funds their risk premium will explode,” he said.

But Senegal on the other hand has welcomed the debt service moratorium, he added.

At the same time, Gillet noted the profile of Africa’s creditors has changed, “which makes any restructuring agreement very complicated”.

“Up until the end of the 1990s, you could get all the creditors around a table,” he said.

“But now you have the debt owed to China, which is not part of the Paris Club (of state creditors), then the debt owed to the private-sector lenders (the London Club of bankers), and then above all the debt raised on the markets.”

Economic Recession: CBN Retains Key Lending Rates

 

The Monetary Policy Committee has retained key lending rates at 11.5%.

Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, announced this on Tuesday, saying it is part of efforts to boost the economy towards a sustainable recovery from the recession.

“Members voted in line with the most pressing need towards reversing the recession and achieving medium-term macro-economic stability.

“In view of the fore-going, the committee decided by a unanimous vote to retain all parameters,” Emefiele said.

“In summary, MPC voted 1, to retain MPR at 11.5%, (2), retain asymmetric corridor of +100 and -700 basis points around the MPR, (3) retain Cash Reserve Ratio at 27.5% and (4), retain liquidity ratio at 30%.”

This comes days after a new report released by the Nigeria Bureau of Statistics, showed that Nigeria had slipped into another recession after the economy shrank in the third quarter of this year.

Read Also: Again, Nigeria’s Economy Slips Into Recession

The same happened in 2016, making it the second recession in a space of four years.

The cumulative Gross Domestic Product (GDP) for the first nine months of 2020, therefore, stood at -2.48 per cent just as it recorded a -6.10 per cent in the second quarter.

According to Emefiele, the recession was anticipated and measures had been put in place to manage its impact.

Meanwhile, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, on Monday, said the country will exit recession by the first quarter of 2021.

Slight Fall In German Unemployment On Economic Rebound

(FILES) This file photo taken on August 20, 2020 shows a general view of Omsk Emergency Hospital No 1 where Russian opposition leader Alexei Navalny was admitted after he fell ill in what his spokeswoman said was a suspected poisoning. (Photo by Yelena LATYPOVA / AFP)

 

German unemployment fell slightly in September, official data showed Wednesday, as Europe’s largest economy showed further signs of recovery following the initial hit from the coronavirus pandemic.

The seasonally adjusted jobless rate ticked down to 6.3 percent in September, from 6.4 percent in August, the BA federal labour agency said.

“The impact of the corona pandemic on the labour market is still clearly visible. However, there are slight signs of improvement,” said the BA’s Daniel Terzenbach.

Coronavirus lockdowns brought the economy to a halt initially but as factories and businesses have returned to work, sentiment has improved.

Economy Minister Peter Altmaier said recently that Germany was on track for a “V-shaped” recovery, signalling a strong upswing in the economy after a considerable decline in earlier in the year.

Government-backed short-time work schemes, called “Kurzarbeit” in German, have softened the blow, saving hundreds of thousands of jobs.

The number of people in short-time work fell in September to 4.2 million from a peak in April of 5.95 million, the BA agency said, although both numbers are considerably higher than at the height of the financial crash in 2009.

Before the coronavirus struck, German joblessness had hovered at a record low of around five percent.

But prospects may darken as the country moves into the colder autumn and winter months and fears grow about a recent uptick in coronavirus cases.

Chancellor Angela Merkel on Tuesday announced new measures to tackle the increase, including restrictions on parties and family gatherings.

“Unemployment should fall by the end of the year,” said Fritzi Koehler-Geib, economist at Germany’s public investment bank KfW.

“However, we can assume that the number of infections will rise again in the autumn. This could lead to a further slowdown in the economic recovery.”

AFP

India COVID-19 Cases Pass Six Million

A health worker (C) wearing a Personal Protective Equipment (PPE) suit collects a swab sample from another health worker for Rapid Antigen Test (RAT) for the Covid-19 coronavirus at a testing centre in Siliguri on August 29, 2020. (Photo by DIPTENDU DUTTA / AFP)

 

India reported its six millionth coronavirus case on Monday as it surged closer to the United States as the most-infected nation, and authorities pressed ahead with reigniting the economy.

The vast nation is home to 1.3 billion people, some of humanity’s most densely populated cities and a feeble health care system, and for several weeks it has reported around 90,000 new cases daily — the highest in the world.

Health ministry data showed a rise of 82,000 cases on Monday, taking the total to 6.1 million and closing the gap on the United States, which has recorded 7.1 million infections. India could leapfrog the US in the coming weeks.

India has a much lower death rate than other worst-hit nations with almost 100,000 fatalities so far — fewer than half the grisly toll of 205,000 recorded in the US, which has roughly a quarter of the population. Brazil has meanwhile recorded 140,000 deaths.

Prime Minister Narendra Modi has called on people to keep wearing face coverings when they ventured outside of their homes.

“These rules are weapons in the war against corona. They are potent tools to save the life of every citizen,” Modi said during his monthly radio address on Sunday.

The virus initially hit major metropolises including financial hub Mumbai and capital New Delhi, but has since spread to regional and rural areas where healthcare systems are even more fragile and patchy.

“In several of the pockets where the transmission is active, the infection has gone into the community,” former national health secretary Sujatha Rao told AFP.

“It is difficult to control transmission in such situations and a dramatic turnaround can perhaps be possible only through a rigorous implementation of a lockdown and preventive measures like mask wearing.”

– No Lockdown 2.0 –

The government is unlikely to reimpose major restrictions after a lockdown in March battered the economy and wrecked the livelihoods of millions of people, particularly the poor.

Some schools have now reopened, and trains, metros, domestic flights, markets and restaurants have been allowed to operate with some restrictions. The Taj Mahal also opened again for tourists this month.

Anand Krishnan, a community medicine professor at the All India Institute of Medical Sciences (AIIMS) in Delhi, said authorities should focus on treating people who contract the virus.

“The only thing that we can do is take care of people who are ill — identify them faster and treat them better. And follow the social-distancing norms,” he told AFP.

“Beyond that, I don’t think there is anything specific that can be done.”

Some locals in Delhi told AFP that while they remained cautious, their worries about the pandemic had lessened since the start of the year.

“I’m out of the house all day because of my work. I don’t step out of the house for anything else,” said 23-year-old medical store worker Umang Chutani.

“The future is uncertain but one can only be cautious and follow all safety protocols.”

Himanshu Kainthola, 61, who recovered from the virus last month after testing positive with two other relatives, said his family’s fears “have reduced substantially”.

“We have made peace with it. We take the necessary precautions and invest in increasing our immunity rather than being anxious or scared of it.”

Creative writing student Santosh added that the virus was now “part of our lives”.

“You cannot shutdown every business, because the economy cannot collapse… Covid-19 is not going to pay the rent,” he said.

AFP

Nigeria Has To Take Economic Diversification More Seriously – Sanusi

 

Former Central Bank Governor, Mohammed Sanusi (II), says Nigeria has to take economic diversification more seriously in order to experience growth and development.

The former CBN governor who was the guest speaker on the second day of the Kaduna Investment Summit, explained that over-reliance on oil has left the country unproductive.

Referencing Malaysia, Sanusi gave a breakdown of the economic growth of both countries within a 30-year period.

According to him, for Nigeria “there was an increase in wealth but without any structural transformation”.

“We were growing but we did not diversify and that explains the huge levels of poverty in the country, it explains the huge levels of inequality in the country, it explains the vulnerability of the economy to shocks, it also explains the relatively slow pace of growth because when Malaysia started, they started from a GDP per capita level lower than Nigeria’s GDP per capita in 1985. It started from $310 to $4,045 while we started from $345 to $2,055”.

He also stressed the importance of the government creating the right environment and infrastructure for private businesses to thrive.

“One way to look at it is to understand the difference between production and consumption,” he said, adding that “electricity per capita is such a critical determinant for moving people out of poverty”.

Read Also: ‘The Fight Is Over,’ Obaseki Extends Hand Of Fellowship To Oshiomole, Ize-Iyamu

Speaking further, the former CBN governor who is also the Vice-Chairman of the Kaduna Investment Promotion Agency, noted that with the right environment, the country can move away from being only consumers to producers of technology.

He urged the youths also to not only rely on the government but to create opportunities for themselves, including exploring the endless possibilities of their smartphones.

“We need to think over and over again as to how we understand economics and what we see. How do we understand technology or electricity are we consumers or are we producers and that’s why investment in human capital is so important.

“Produce young men who know that they are worth more than just using their phone to import a pair of shoes,” he said.

South African Economy Could Shrink More Than Forecast – Minister

A queue of cars are seen at the Maseru Bridge border post between Lesotho and South Africa on March 24, 2020. Molise Molise / AFP.

 

South Africa’s Finance Minister Tito Mboweni warned Sunday the economy could shrink by more than the 7 percent forecast by policymakers and the central bank for 2020, adding that public finances are “overstretched”.

The economy of Africa’s most industrialised nation contracted by more than half in the second quarter of this year, an unprecedented decline caused by anti-coronavirus restrictions.

Looking ahead, there is a “risk that the actual GDP outcome for 2020 could be lower than previously thought,” Mboweni wrote in the local Sunday Times newspaper.

The Treasury and central bank expect the economy to contract by 7.2 and 7.3 percent respectively this year, after the country went into a strict lockdown in March already in recession.

Mboweni noted that public finances, already in an “unsustainable position” before the pandemic, were now “overstretched”.

“The reduction in economic activity in the second quarter has flowed through to lower tax revenue,” the minister wrote, adding that emergency tax relief to keep households and businesses afloat would compound the loss.

Government is expected to fall short of more than 300 billion rand ($18 billion) in tax revenue — over six percent of GDP — Mboweni said, forcing the heavily indebted country to “borrow even more”.

But he also promised reforms to climb out of the hole, writing “we must be bold in confronting what has impeded economic growth and the progress of our nation.”

He wrote that one of government’s priorities would be to ensure “adequate and reliable electricity”, backed by a commitment to unlock private investment in the public sector.

Unreliable electricity supply from state operator Eskom’s fleet of rickety coal-fired power stations is often blamed as a source of economic instability in South Africa.

The country accounts for around half of the continent’s coronavirus cases, with over 648,000 infections and 15,427 deaths recorded to date, although daily increases have been dropping since July.

AFP

Asian Markets Mostly Up As Focus Turns To US Jobs Data

A woman walks past a screen showing information and the index of the Taipei Stock Exchange on July 24, 2020. Sam Yeh / AFP
A woman walks past a screen showing information and the index of the Taipei Stock Exchange on July 24, 2020. Sam Yeh / AFP

 

Asian markets mostly rose Tuesday following another healthy month for global equities, fuelled by expectations of cheap borrowing for years to come, while traders were turning their attention to the release of US jobs data later in the week.

While the Nasdaq powered to yet another record as tech firms are fired up by people being forced to stay home by the virus, the Dow and S&P 500 dipped, though both enjoyed their best August in more than 30 years.

But signs of a new pick-up in infections around the world and a lack of any movement on a new US stimulus package for the world’s top economy were keeping buying sentiment at bay.

“Following such a strong month and such a strong recovery since we saw the trough back in March, we do think we could see some turbulence over the next few months,” Tracie McMillion, at Wells Fargo Investment Institute, told Bloomberg Television.

“We’re entering a seasonally weaker period, we’ve got elections on the horizon, and also we’re entering the fall and there could be some coronavirus escalation that also could start to worry market participants.”

Shanghai climbed 0.4 percent, with helping coming from news that a survey of Chinese manufacturing had shown a pick-up in activity, a day after an official reading showed a slight dip in the sector.

Hong Kong and Tokyo were flat, while Mumbai added 1.3 percent, a day after data showed the Indian economy shrank a historic 23.9 percent in April-June, which was worse than expected.

Seoul, Taipei, Jakarta and Bangkok were well in positive territory but Sydney, Manila and Wellington were more than one percent lower, while Singapore also dropped.

In early trade, London dipped as traders returned from a long weekend, though Paris and Frankfurt rose.

The key event this week is the release Friday of closely watched US non-farm payrolls figures, which will provide the latest snapshot of an economy that has been struggling in recent weeks from the reimposition of some virus containment measures owing to fresh flare-ups across the country. Updates on the factory and services sectors are also due this week.

Still, the weakness has not given US lawmakers any urgency to push through a new rescue deal, with Republicans and Democrats still at loggerheads.

Treasury Secretary Steven Mnuchin said Republicans will soon unveil a new spending bill “for kids and jobs”, which is likely to come in at around $1 trillion, less than half that offered by Democrats.

He said Democratic leaders in the House and Senate “just don’t want to negotiate in good faith”, and with senators on recess until September 8, there is little chance of anything being agreed soon.

“Not only is ambivalence hurting the nascent economic recovery, more importantly, it keeps the neediest checking their mailboxes regularly while praying a second stimulus check miraculously arrived,” said Stephen Innes at AxiCorp.

“We are talking about people needing to buy groceries, not luxury items here. It’s time for Congress to get off their derrieres and put something actionable together.”

The dollar was at its weakest level against the euro since May 2018 while sterling was around nine-month highs. Oil prices rallied more than one percent, with the commodity helped by signs of a pick-up in US demand.

– Key figures around 0810 GMT –

Tokyo – Nikkei 225: FLAT at 23,138.07 (close)

Hong Kong – Hang Seng: FLAT at 25,184.85 (close)

Shanghai – Composite: UP 0.4 percent at 3,410.61 (close)

London – FTSE 100: DOWN 0.1 percent at 5,959.29

Euro/dollar: UP at $1.1974 from $1.1935 at 2045 GMT

Dollar/yen: DOWN at 105.75 yen from 105.89 yen

Pound/dollar: UP at $1.3406 from $1.3370

Euro/pound: UP at 89.32 pence from 89.26 pence

West Texas Intermediate: UP 1.1 percent at $43.08 per barrel

Brent North Sea crude: UP 1.2 percent at $45.80 per barrel

New York – Dow: DOWN 0.8 percent at 28,430.05 (close)

AFP

Stocks Slide As US Jobless Data Fuel Economy Concerns

Traders work on the floor of the New York Stock Exchange (NYSE). Spencer Platt/Getty Images/AFP.

 

Stock markets slid Thursday as worse-than-expected US jobless data stoked concern about the outlook for the world’s biggest economy.

The dollar fell against the euro in response to the news that just over 1.1 million people filed new claims for jobless benefits last week, a steeper rise than anticipated.

Stock prices, already in the red earlier in the session, continued lower as a result, pulled down by early losses on Wall Street.

Already on Wednesday, a sobering Federal Reserve assessment of the US economic outlook had soured sentiment on stock markets across the globe.

“The fallout from the Fed minutes continues across markets, with European indices in the red and US futures pointing to a weaker open after days of gains,” noted Chris Beauchamp, analyst at IG trading group.

With the coronavirus continuing to ravage the country and containment measures keeping businesses closed, minutes from the Fed’s July meeting showed it was concerned about the recovery, as help for small businesses, extra money for the jobless and direct payments to all Americans come to an end.

Federal Reserve chief Jerome Powell has led repeated calls for more government support for the economy.

The “minutes are casting a shadow over markets and underline that any recovery is not going to be a straight line of advances”, said Neil Wilson of Markets.com.

“The Fed layered on the risks and caution thick, but didn’t come up with any sweeteners for the market in the shape of more easing.”

“There is a big risk the economy may not recover as strongly or as quickly as had been priced in by US markets,” said ThinkMarkets analyst Fawad Razaqzada.

The Fed minutes “revealed that policy makers… were concerned that coronavirus posed ‘considerable risks’ to the economic outlook. It is very difficult to remain bullish on US equities without witnessing a sizeable correction first.”

After bottoming in March, world equities have surged thanks to a wall of cash support from the Fed and other central banks.

But with the multi-trillion-dollar fiscal rescue hammered out earlier this year now running out, US lawmakers are under pressure to stump up more.

While Democrats and Republicans dig their heels in on a new package, the chances of anything coming soon are slim.

Adding to the downward pressure were ever-present China-US tensions.

– Key figures around 1340 GMT –

New York – Dow: DOWN 0.4 percent at 27,592.87 points

London – FTSE 100: DOWN 1.5 percent at 6,020.95

Frankfurt – DAX 30: DOWN 1.3 percent at 12,813.52

Paris – CAC 40: DOWN 1.3 percent at 4,911.34

EURO STOXX 50: DOWN 1.3 percent at 3,273.83

Tokyo – Nikkei 225: DOWN 1.0 percent at 22,880.62 (close)

Hong Kong – Hang Seng: DOWN 1.5 percent at 24,791.39 (close)

Shanghai – Composite: DOWN 1.3 percent at 3.363.90 (close)

Euro/dollar: DOWN at $1.1815 from $1.1841 at 2100 GMT

Dollar/yen: DOWN at 105.93 yen from 106.12 yen

Pound/dollar: UP at $1.3103 from $1.3093

Euro/pound: DOWN at 90.21 pence from 90.40 pence

West Texas Intermediate: DOWN 2.5 percent at $42.00 per barrel

Brent North Sea crude: DOWN 2.1 percent at $44.37 per barrel.

AFP

We Cannot Afford To Let Our Economy Slide, PTF Tells Business Owners

PTF Chairman, Boss Mustapha, speaking at a press briefing in Abuja on August 13, 2020.

 

The Presidential Task Force (PTF) on COVID-19 has called on Nigerians to take advantage of the Federal Government’s effort to cushion the effect of the pandemic on the nation’s economy and the people.

The PTF Chairman, Boss Mustapha, made the call on Thursday at the briefing of the task force in Abuja, the nation’s capital.

He noted that the United Kingdom hinted that it would be going into a recession after its economy suffered a slump in growth by a record 20 per cent in the second quarter.

Mustapha, who is also the Secretary to the Government of the Federation (SGF), said the Nigerian Government had put in place an Economic Sustainability Plan to prevent such occurrence.

He explained that the plan was backed by a stimulus package in the sum of N2.6 trillion to boost local economies and production, for all sizes of businesses, including small family businesses.

The PTF chairman believes it is important for businesses in the country to take advantage of the stimulus package to revive their businesses and give them a boost.

Giving an update on the outbreak of COVID-19 in Nigeria, he noted that the country has reported fewer numbers of confirmed cases in the last two weeks.

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Mustapha, however, warned that the reports should not be misconstrued as a victory over the virus.

According to him, there is still a serious battle to be fought ahead as a country and it is that the nation continues to build on the successes recorded so far.

The SGF also gave an update on the ongoing exercise to evacuate Nigerians stranded in various countries as a result of the pandemic.

He revealed that a total of 14,906 people have been evacuated during the COVID-19 pandemic and almost 80 per cent of them were youths.

Mustapha added that 13,844 of the returnees had taken the COVID-19 test so far and the results of 684 people came back positive.

Read the full text of the PTF chairman’s remarks at the briefing below:

REMARKS BY THE SECRETARY TO THE GOVERNMENT OF THE FEDERATION/CHAIRMAN OF THE PTF-COVID-19 AT THE NATIONAL PRESS BRIEFING OF THURSDAY, 13th AUGUST, 2020

I welcome you all to the National Briefing by the Presidential Task Force (PTF) on COVID-19 for Thursday, 13th August 2020.

The country has effectively entered the second week of the extended eased lockdown phase and the PTF continues to monitor global and national trends in the response to the COVID-19 pandemic.

Globally, the world continues to pursue the search for a vaccine with over 1000 trials on-going and different claims of levels of success. We note particularly, the announcement by the President of Russia on the breakthrough in the development of a vaccine even as we study the developments.

Fighting the pandemic successfully will take a global effort and Nigeria will not be left out whenever and wherever progress is made. However, the health and safety of Nigerians will always remain our priority in the pursuit of a solution.

For us in Nigeria, we shall remain focused on propagating the use of proven avoidance methods to break the transmission of the virus and effective case management to care for and treat infected persons.

The ravaging effect of the COVID-19 pandemic on the global economy should provide more compelling reasons for us all to leave no stone unturned in fighting this pandemic.

This week, the United Kingdom would be going into a recession after its economy suffered a slump in growth by a record 20% in the second quarter.

I wish to remind all Nigerians that ahead of such occurrence, our Government had put in place an  Economic Sustainability Plan backed by a stimulus package in the sum of N2.6 trillion to boost local economies, production and for all sizes of businesses including small family businesses.

I, therefore, urge our businesses to take advantage of the stimulus package to revive and/or boost their businesses. We cannot afford to let our economy slide.

The PTF wishes to note as we have done before that fewer numbers of confirmed cases have been recorded in the last two weeks. This should never be misconstrued as a victory over the virus.

There is still a serious battle to be fought ahead of us as a people and as a country. It is, important, therefore, that we continue to build on our successes and not do anything to detract from them.

Our Risk Communication and Community Engagement messaging and consultations have been intensified, to drive the level of awareness and compliance to the wider population using media and platforms that are most effective generally and specifically.

We wish to appeal to all Nigerians to exercise caution and restraint at all times. I wish to note however that from the reports for yesterday 12th August 2020 no fatality was recorded.

The PTF is pleased to associate with the celebration of International Youth Day 2020 under the theme “Youth Engagement for Global Action” which seeks to recognize the immense contributions and role of young people in achieving sustainable peace and development across all levels.

Implicit in this is the need to galvanise engagement of youths to significantly enhance peacebuilding to promote social cohesion in this era of social distancing and collective fight in containing the COVID-19 pandemic.

The PTF appreciates all our young people who have stepped out and are contributing to the fight against the pandemic and implore others yet to do so, to join this fight with all the necessary passion their youthful energy can bring to bear. I am sure that our risk communication and community engagement strategy would gain a lot of mileage if the various youth organisations and the youths themselves heed this call.

It might interest you to note that of the 14,906 evacuees received during this COVID-19 pandemic, close to 80% are youths for which we are glad that only 684 tested positive to the coronavirus out of the 13,844 so far tested.

In the coming days, we hope to receive more evacuees from different parts of the world. The National Coordinator will elaborate on this.

In the course of the week, the United States of America made good the promise made by President Donald Trump to donate medical equipment, including 200 ventilators to Nigeria as a support in the fight against the COVID-19.

Nigeria recognises the fact that the pandemic is a global challenge and particularly, it has impacted the United States of America in several ways, yet the bond of friendship has prevailed.

This sacrifice and support to Nigeria is very much appreciated. I want to assure the Government and people of the United States that these ventilators, like other materials received from our various partners, would be judiciously deployed and transparently managed.

I now call on the Honourable Minister of Health, DG, NCDC, and the National Coordinator to provide us with technical updates.

I thank you so much for your attention and have a good evening.

Russia’s Economy Shrinks By 8.5 Percent In Second Quarter

People wearing face masks to protect against the coronavirus disease wait for a bus at a bus stop in the town of Chekhov, some 70 km outside Moscow, on August 11, 2020. Yuri KADOBNOV / AFP
People wearing face masks to protect against the coronavirus disease wait for a bus at a bus stop in the town of Chekhov, some 70 km outside Moscow, on August 11, 2020.
Yuri KADOBNOV / AFP

 

Russia’s economy contracted by 8.5 percent year-on-year in the second quarter, the state statistics agency said Tuesday in its first assessment of the impact of the coronavirus and an oil crisis.

GDP fell in “all areas of the economy except agriculture” between April and June, the Rosstat agency said in a statement, with passenger transport down 79 percent and the services industry down 37.2 percent.

Rosstat’s figure for the second quarter was within the central bank’s forecast of between 8 and 10 percent, while the government had predicted a 9 percent reduction in economic activity.

The sharp drop came after 1.6 percent growth in the first quarter.

Russia had seen its economy pick up towards the end of 2019, while economic growth over the year as a whole was a sluggish 1.3 percent.

Russia had hoped 2020 would see an economic revival bolstered by massive state projects to modernise infrastructure.

Those hopes were crushed by an oil crisis that began in March. Russia and Saudi Arabia launched a price war, dealing a severe blow to Russia’s economy dependent on exports of oil and gas.

The virus pandemic hit Russia shortly afterward and the country imposed strict lockdown measures from the end of March until early May.

The Russian economy has been less badly hit by the virus than some countries due to its smaller service sector, according to economists.

President Vladimir Putin said in mid-July that Russia’s economic activity was “gradually” recovering.

Shortly afterwards Russia dropped an ambitious goal to become one of the world’s top five economies by 2024 and pushed a target to halve the numbers living in poverty back by six years to 2030.

 

 

AFP